Americans all have something in common. Liberty? The right to the pursuit of happiness? No, it's debt. No one starts out as a young person looking forward to having a lot of debt when they get older. But before we are even out of college, we have probably accumulated some debt in the form of college loans and credit card debt to pay for books and clothing. The next thing you know, you are married, with a couple of kids, and a house and a car. And you are still paying for that old debt, and have added a few more on, such as a mortgage and a car loan and some more credit card debt to buy things for you and your family.
Maybe you have decided to make this the year you are going to get rid of your credit card debt. How do you go about doing this/ Well, you might consider destroying all the credit records, or killing off the people who lent you money, but then you would just be sent to jail and when you got out, your credit record would be even worse.
Figuring our the fastest and easiest way to get rid of credit card debt may seem like a difficult task, but it can be very simple and easy. The first thing you have to do is is get out all of your credit card statements and look at the interest rate on each one. Make a list of all of the cards, how much is outstanding on each one and what the interest rate is. This may be a depressing exercise, but it is necessary. Next, go online. Go into Google and search for debt consolidation loans. You want to take all of your credit card balances and consolidate them into one balance and one monthly payment on that balance. You are going to shop around on the net for the lowest interest rate. You may consider a loan, or perhaps a new credit card that you will transfer all of your other credit card balances to. The most important thing is the annual percentage rate. You are paying high interest rates on your credit cards balances so that when you reduce the interest rate, you will reduce how much you have to pay in total. Yes, you have to pay off the principal that you used to buy things for you and your family, but do you want to throw away money on interest that doesn't get you anything else. Get your interest rate down, and you can start to eliminate the debt.
It may take a while, but you can eliminate this credit card debt. Using your computer as a search tool, you will be able to find the best interest rate offer for you and then consolidate all of the loans into one.
Did you read this?
Deciding When Your Teen Should Get a Credit Card
Using Your Credit Card to Manage Your Finances
Don't Let Credit Card Debt Get You Down
Ярлыки: Credit Card Debt
Credit Card Protection Insurance: What You Need To Know
Your credit card company may offer it under a variety of names. Credit card protection insurance. Credit Shield. Payment protection. Credit safeguard. But no matter what name it goes by, this insurance aims to provide the cardholder with the same thing: security in case unemployment, injury, disability, or death makes paying your monthly credit card bills impossible. By paying a monthly fee (which vary between issuers), if you should lose your job or become incapacitated, your credit card payments are put on hold and interest is suspended, often for as much as two years. This can help keep your credit rating intact during a rough patch, enabling you to remain in good standing with creditors.
But is paying for such a service worthwhile? If you do suffer an unforeseen life event, credit insurance protection can be helpful in preventing your debt from spiraling beyond your control. As with any insurance, credit card insurance needs generally are very specific to a person's life situation.
To understand what your credit card company may offer, consider the four major types of credit insurance: life, disability, involuntary unemployment and property.
- Credit life insurance pays the balance owed on your card when you die, provided the credit card company is named the beneficiary of the insurance.
- Credit disability insurance covers the minimum payment due on your card for a specified period following a medical disability, with purchases made after you become disabled not covered.
- Credit involuntary unemployment insurance pays the minimum amount due on your account should you be laid off from work or downsized for a certain length of time, with purchases made after you become unemployed not covered.
- Credit property insurance may be included with your credit card and usually provides payment for items purchased with the card if the items are damaged or, in some cases, stolen.
With disability and unemployment credit card insurance, a drawback is that the payment made by the insurance is just the minimum monthly payment and often for a very limited time frame. Minimum payments are mostly between 2 percent and 3 percent of your balance, meaning interest will still accrue on the remaining 97 percent to 98 percent of what you owe. If you have more than one credit card, you must purchase separate insurance for each card. Meanwhile, for major illnesses, at the time of the incident you generally must have been employed for a minimum of 20 hours per week. The insurer will sometimes only pay off your minimum payment until a maximum benefit (generally $5,000 to $20,000) is reached or you return to work, whichever happens first.
Should you suffer a critical illness or death, the insurer will pay off your entire balance, saving your family members from having to make payments. In such cases, coverage may be limited to major afflictions. Once again, the credit card company will only pay up to a maximum benefit (generally $5,000 to $20,000).
Prior to signing up for credit card protection insurance, ask your card issuer the following questions:
- What situations will the insurance pay for and which ones will it not cover?
- Will the insurance cover a spouse or other supplementary cardholder?
- Can you choose to purchase just one or two coverage options or do you have to purchase all of them?
- What are the requirements for each policy -- such as if you miss a payment or your account is not in good standing when you file a claim?
- Do age restrictions exist for life or disability insurance?
- What does the insurance cost annually, and how frequently can rates go up?
- How can the policy be canceled?
Before purchasing credit card or any insurance, be aware of exactly what you are getting and what it will cost over time.
Although your case may be covered depending on your situation, for many consumers credit card insurance is expensive and rarely pays off. Enrolling in credit card protection insurance effectively boosts your annual percentage rate. A premium is charged on a monthly basis, and is calculated by multiplying a set fee by your outstanding balance. Even if you lose your main income stream, secondary money from savings, investments, or other coverage (such as your employer's disability insurance) could help you make the minimum credit card payment. And hold on to any documents proving your illness, as you will have to include it with your insurance claim.
Additionally, be careful if you get a call from a person claiming to offer credit-loss protection from your credit card issuer. Many scammers use this technique to get you to provide your credit card number and expiration date by claiming they need this information to issue the insurance. You do not need credit-loss protection in most cases, since the cardholder is only held accountable for the first $50 of fraudulent charges made with their plastic and only then if they do not report the loss to the issuer in a prompt manner.
Ярлыки: Credit Card Protection Insurance